‘Composition of inflation stands out as factor to be considered’

ANKARA

In October, the composition of inflation stands out as a factor to be considered, the Central Bank has said in a report on the monthly price developments.

Unprocessed food prices, which are prone to temporary supply conditions and are relatively beyond the control of monetary policy, posted a strong rise in this period driven by fresh fruits and vegetables, the bank said.

Unprocessed food prices advanced 6.75 percent monthly in October for an annualized increase of 47.05 percent.

The monthly and annual headline consumer price inflation was 2.88 percent and 48.58 percent, respectively, surprising on the upside.

Monthly food inflation, excluding fresh fruits and vegetables, remained lower at 1.29 percent.

On the other hand, a milder picture prevails in core goods that are affected more by the monetary policy, and in certain services items that are sensitive to demand, the bank said.

“In this respect, the level of headline inflation falls short of accurately displaying this improvement in the composition, whereas the indicators of underlying inflation offer a clearer picture,” it added.

When adjusted for seasonal effects, core goods inflation decreased compared to September.

“In this period, the monthly rise in seasonally adjusted services prices also decelerated, mainly led by the weakening rents and restaurants-hotels groups as well as by the other services group due in part to the conclusion of the education-driven relative price adjustment,” the bank said.